Sneakernomics: How Skechers Became The No. 2 Sneaker Brand In The U.S.

Matt Powell
, ContributorSneakernomics: I write about the culture and business of sportsOpinions expressed by Forbes Contributors are their own.

One of the most fascinating stories in the sports business over the last 18 months is the rise of Skechers to become the number 2 sneaker brand in the US, behind Nike/Jordan. This blog will examine that share grab and the factors that caused it to happen.

In 2010, we experienced a phenomenon we had never seen before: the meteoric rise of a single footwear category. Toning footwear seemingly came out of nowhere and suddenly was the hottest sneaker product in the last decade. Brands and retailers were rushing to get a piece of the action.

But, as so often happens when we are working without a road map, retailers bought far more pairs than the consumer wanted and the brands made even more pairs than that. Overnight, Toning shoes went from a “must-have” item to the clearance racks. Sales plummeted in 2011 and by 2102, the category had virtually disappeared.

Skechers, as they often are, were right in the middle of this sales boom and bust. The stock price got crushed.

After the smoke cleared, management recognized that they needed greater control of their business, that boom/bust cycles were no longer going to be tolerated. Skechers put into place a system of planning and review of sales by style with each of their major retail partners. Orders and inventory are now reviewed often and adjustments made to manage the growth intelligently. Skechers is now much more reliant on data in making smart decisions about orders and production.

Skechers has also taken a page from the big boy’s playbook. In the past Skechers was essentially a one trick pony, riding a single item or category hard (and often into the ground). Today, Skechers has multiple categories in play, all with a hot item of their own. When retailers survey the lines, there are key stories in multiple categories. If one category were to slow, the others will mute the decline in that portion of the business. This makes for a sustainable growth trajectory.

With the signing of Meb Keflezighi, and his immediate success in the Boston Marathon, Skechers vaulted into the arena of athletic credibility. The subsequent signing of Kara Goucher and then Matt Kuchar, further bolstered Skechers’ position as an authentic athletic brand. No doubt this credibility has had an impact on the spouse of the core Skechers demographic, the Soccer Mom.

At the same time Skechers has been surging, its peers have been struggling. The shift away from Technical running as fashion hurt nearly every brand that serves that category. Adidas’ US woes have been well documented. No doubt some of Skechers success has come from the weakness in its peers.